May 31, 2006, Lusaka
The marketing season for cotton is on and there is not yet an agreed upon price set for the crop. Early during the month of May, cotton growers in the Eastern Province (Katete) complained that some ginners had started buying their (farmer) cotton at a price as low as K800 per Kilogram of grade A cotton. This indicates a reduction of about K400 from the K1 200 per Kilogram of grade A, which was offered to the farmers during the previous marketing period (2004/2005).

It is sad that despite the farmers’ clear complaints over the low prices; no one has come to their aid. The government and other stakeholders have been having meetings to discuss the issue of pricing the commodity. This is a positive move of course and shows that the government is listening. However, there is an urgent need for something to be done sooner than later to stop those ginners who have started buying the crop at the exploitative price, taking advantage of the desperation of small scale farmers who cannot hold onto their crop until a better price is offered.

Ginners have agued that they are offering the K800 / Kg of grade A price because of the appreciation of the Kwacha against the major currencies like the US Dollar. It is true that the appreciation of the Kwacha has negatively affected exporters. Therefore, it is the role of the government to ensure that in times when such incidences happen, measures to correct the situation are immediately put in place. The Organisation Development and Community Management Trust (ODCMT) feel that ginners should revise the prices so that they are able to realise their profits and farmers do not lose out, otherwise the government should come up with a way of cushioning the losses the small scale farmers are likely to face because of the Kwacha’s appreciation. It would be unfair if ginners were allowed to reduce prices from last season’s K1 200 per Kilogram to K800 per Kilogram of grade A cotton because farmers got the inputs at a time when the Kwacha had lesser strength.

There are a lot of unfair trade practices in the out-grower scheme arrangements because producers (farmers) are not taken as partners but cheap labour in the business. This is evident in Cotton and Tobacco business where farmers produce their crops but at the end of the day gain almost nothing out of it. A lot of issues need to be put straight if the out-grower schemes are to make sense to the economic development of Zambia. For instance, there is no clear marketing system of cotton in the country. The grading system also is not clear and the worry is if the K800 price for grade A cotton is effected, it is unlikely that most farmers will sell their cotton at grade A. There have always been cases where ginners would buy grade A cotton at the price of grade B or C, even when the producer was convinced that their cotton was of grade A quality. It is common practice that ginners would grade the cotton in the absence of the farmer.